Toronto real estate prices go down as home sales plunge by 49% in November

Growing interest rates keep affecting the housing market of the Greater Toronto Area with home sales, listings, and the composite benchmark price falling both annually and monthly last month.

The latest report by the Toronto Regional Real Estate Board shows that GTA home sales were down by 49% in November on a year-over-year basis to 4,544 units. Monthly sales also fell.

In addition to it, new listings were down as well: by 11.6% to 8,880 from 10,044 in November 2021. According to the report, the composite benchmark price fell by 5.5% to $1,089,800 from $1,163,323 seen a year earlier. The average price of all housing types went down by 7.2% to $1,079,395 from $1,162,564 a year ago.

“Higher borrowing costs represent only a short-term shock to the real estate market,” – TRREB president Kevin Crigger noted. “In terms of the medium- and long-term perspective, the demand for homeownership will rise sharply. The reason is that a large share of record immigration will be focused on the GTA and the Greater Golden Horseshoe (GGH) over the next years, and all of these people will need a place to live, with many of them deciding to purchase. The long-term issue for policymakers will not be inflation or borrowing costs. It all comes down to providing enough properties for the population growth.”

Although the market activity has fallen drastically since the central bank started raising its key lending rate in March, TRREB says immigration will make those on the sidelines act.

In a recent interview, TRREB’s chief market analyst Jason Mercer said that immigrant households usually focus on buying their own homes. It means that we may see a long-term demand hike as Canada opens its borders to a record number of immigrants in the nearest future.

“If you look at the long-term demand for properties, whether it’s a purchase or a rent, the Greater Golden Horseshoe and obviously the GTA is the main concentration of immigration in Canada,” – Mercer added.

It means that stronger competition in the real estate market will force buyers to return to the market even in spite of higher mortgage rates.

TRREB’s report says semi-detached houses took the largest hit with an average price drop of 13.9% on a year-over-year basis. Halton Region saw the largest decrease across all home types at 11.18%.

Продажи жилья по системе TRREB MLS и средняя цена в период с 1 по 30 ноября 2022 года

	2022			2021
	Sales	Average Price	New Listings	Sales	Average Price	New Listings
Toronto (“416”)	1,798	1,050,788	3,562	3,576	1,096,875	4,253
Rest of GTA (“905”)	2,746	1,098,127	5,318	5,403	1,206,041	5,791
GTA	4,544	1,079,395	8,880	8,979	1,162,564	10,044

 

 

	Sales			Average Price
	416	905	Total	416	905	Total
Detached	542	1,514	2,056	1,560,548	1,329,165	1,390,162
Yr./Yr. % Change	-40.6%	-48.2%	-46.4%	-13.8%	-10.9%	-11.3%
Semi-Detached	169	217	386	1,187,016	924,080	1,039,200
Yr./Yr. % Change	-40.3%	-53.8%	-48.7%	-17.1%	-13.7%	-13.9%
Townhouses	178	596	774	995,074	872,014	900,314
Yr./Yr. % Change	-53.3%	-44.0%	-46.4%	1.4%	-8.7%	-6.4%
Condo Apartment	899	390	1,289	734,797	648,332	708,636
Yr./Yr. % Change	-54.5%	-55.9%	-54.9%	-1.5%	0.3%	-0.9%